Bear Pressure Mounts in EUR/JPY
02 October 2009
Over the last few months the price action in EUR/JPY has been on the choppy side, with the 2009 recovery slowing ahead of a 50% retracement level. The Daily chart now appears to be on the cusp of giving a bear signal, which would further postpone any test/break of this key resistance.
WEEKLY CHART:
This year’s recovery earlier had the 141.00 50% level in its sights (coincides with two prior high areas from 2003/2004) – it remains elusive for now and there is currently bear risk.
DAILY CHART:
The key support at/above the 129.75 76.4% level has now come under pressure (including today) –in the FX Specialist Guide we have said that a break/close below this would be an initial bear signal/trigger now.
The recent failure at the 135.53 21-Sep high, back to the rising support line is, in fact, an early bear sign.
The first bear target would be the 125.63 50% retracement. Initial support may well be found here, but subsequent move lower could close in on the 118.45 76.4% retracement before next decent support emerges.
Only a recovery/close above that 135.53 high would shrug off current bear risk.
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